Transcript Essential of Direct Response Media

The Essentials of
Direct Response Media
Thanks to Wunderman Worldwide
The Essentials of Classic
Direct Response Media
• Direct Mail
• Print
• Broadcast
– Television
– Radio
• Support Media
The Role of Media
• Media planning is concerned with how to
use advertising time and space most
effectively (and efficiently) to contribute
to the achievement of marketing
objectives.
The Role of Media
• Media provides a bridge that delivers the
right message (and offer) to the right
target. In this respect, media decisions
that deliver both image/awareness are the
same for direct response efforts.
• Media planning that is involved with
generating a direct response, goes steps
further in analyzing previous results and
projecting future response.
Media’s Role in Direct Marketing
• The “accountable” nature of direct
marketing is the crucial determining
factor used to plan each media campaign.
Historical response analysis is the
foundation and starting point for the
overall planning process.
Media’s Role in Direct Marketing
• Front-end Response
-% response
-Orders per thousand
-Cost per order
Media’s Role in Direct Marketing
• Back-end Response
-The quality of the customer is primarily
measured by total sales (net of bad pay)
per customer, but related measures are
also used such as: conversion %, renewal
rate and upgrade %, cross promotion
sales, credit card usage, and ultimately a
“Lifetime Customer Value” Index.
Direct Response Media
All media can be utilized for direct response advertising:
Broadcast
Network Television
Spot Television
Cable Television
Radio
Print
Newspaper/FSI’s
Business/Trade
magazines
Consumer
magazines
Direct Mail
Compiled
Lists/Databases
Mail Response
Lists
Subscriber Files
Out-of-Home
Outdoor
Take-Ones
Kiosks
In-Home
Co-Op Mail
Package Inserts
Telemarketing
Inbound
Outbound
Media Decision Factors
• See table on next page.
Planning Direct Mail
Type of Lists
• Compiled
– Names and addresses derived from
directories, public records, newspapers,
retail sales slips, trade show registrants, etc.,
to identify groups of people who have
something (single identifiable characteristic)
in common.
Type of Lists
• Response
– Names and addresses of consumers or business
executives who ordered and paid for a product or service
through the mail.
• Response Enhanced
– Consumers(purchasers) who have filled out
questionnaires and mailed in those questionnaires which
describe their demographics, psychographics and specific
product buying habits.
• House List
– Purchased or inquired, 5-6 times better results
R-F-M
• Recency
–When was the last time they purchased?
• Frequency
–How often do they purchase?
• Monetary
–How much money do they spend?
Other Important Selection Criteria
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Sex
State
SCF/ZIP
Age
Other Important Selection Criteria
• Source
– Direct mail sold
– Print
– Other direct mail media
• (Renewals, M-G-M’s, Package Inserts, Co-Ops,
Statement Stuffers, Syndicated Products, School
Marketing)
– Broadcast
– Telemarketing
– Take Ones, FSI’s, ETC.
– Warranty Cards
Merge/Purge Advantages
• Previously mailed names are eliminated.
• Each prospect gets only one mailing
piece.
• Current customers are eliminated.
• Bad debts are eliminated.
• DMA pandering names are eliminated
(House pandering also).
• Inter-file duplicated are analyzed.
Merge/Purge Advantages
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Multi-buyers are flagged for remailing.
Nixi’s are eliminated, (NCOA).
Demographic data can be appended.
Phone numbers can be appended.
Carrier route coding provides for postal
savings.
• Decoys are added in.
Planning Print Media
Planning Print
• Step One: Establish Objectives
-Direct Sales or Lead Generation
-Image plus Action
-Retail Support
• Step Two: Determine Goals
-Cost/Response or Order
-Volume of Leads/Sales Needed
-Budget
Planning Print
• Step Three: Establish Media Variables
-Target Audience
-Seasonality/Responsiveness
-Unit
• Step Four: Response Projections
-Based on Historical Data
Target Audience
• Step One: Sizing the Opportunity
-Syndicated Research
• Step Two: Determine Media Usage
-Broad Audience: Mass Publications
-Narrow Audience: Targeted Publications
Seasonality/Responsiveness
• Seasonality of Product
• Most Responsive DR Months
-January
-February
-September
-October
• Frequency Separation
Unit
• Insert units vs. on-page
• Balance of volume and efficiency
– Larger, intrusive units
• Volume
• High Response Rates
• Expensive out-of-pocket
– Small space units
• Low response rates
• Low volume
• Efficient CPO
Buying Print
• Direct Response Rates
• Corporate Rates
• Frequency Rates
• National vs. Regional
Positioning
• Front of Book, RHP
• Back to Book, Heavy DR
• Editorial Adjacency
• Competitive Separation
Test Structure
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2-5 Key Categories
2 magazines per category
2-3 unit tests
A/B splits
– Creative
– Offer
– Units
• Statistically reliable
• Individual key codes for clean read
Direct Response Television
DRTV: What is it?
• A direct marketing strategy…
• Designed to generate a response…
• Utilizing low-cost spot television…
• In a variety of lengths...
DRTV: What is it?
DRTV is often purchased for as little as one-quarter
the cost of General Advertising
• Time is bought in large blocks, I.e. dayparts
rather than specific programming
• “Hybrid” clients pay a higher rate guaranteeing
select daypart rotations
• Time is pre-emptible
Qualifications for Direct Response Rates
• The offer should be exclusive and not
communicated in other advertisements.
• The commercial must have a strong call-toaction urging the viewer to call now.
• The offer should be time-dated and good for
a limited time.
• A general oriented commercial with an 800#
added will not qualify as direct response.
Stations review story boards prior to
accepting the execution.
Direct Response Television Process
• Direct Response television commercials
produce two types of sales results:
–One-step process:
• Utilized by most traditional DRTV
advertising (subscription, low out of
pocket items)
• Telemarketing closes order obtaining
all pertinent information
Direct Response Television Process
– Two-step process:
• Additional information is generally required to
close a sale
• Often utilized for items costing over $200.00
• Multiple product/service items exist
• Requires more sophisticated support from
either telemarketing or from in-person sales call
• Advertisers include; insurance, home loans,
financial products, exercise equipment
Direct Response Television Process
• Direct Response Television is more like
the Stock Market than it is television.
–DRTV is:
• A commodity
• Extremely volatile
• Difficult to second guess
The Planning Process
• Media Plan prepared utilizing client and
agency data from other clients on
individual station response levels.
• The “accountable” nature of direct
marketing is the crucial determining
factor used to plan each media campaign.
The Planning Process
• Historical response analysis* is the
foundation for the planning process:
–Front end response
• % response and cost per inquiry
–Back end response
• % quality of customer and lifetime
value
Step: 1
Setting campaign goals/strategic approach
–Leads/orders
–Awareness Building
–Spending levels
Step: 2
Select and Rank (priority) markets/stations
–Previous history/back end data
–Responsiveness
–Efficiencies
–Marketplace conditions
–Anticipated clearance
–Product distribution
–Target audience penetration
Step: 3
Commercial Length
Both :120’s and :60’s are strategically
integrated into a campaign
– :120’s
• Base support on all spot stations
–More responsive than :60’s
–More cost effective than :60’s
–Ability to clear on most stations and
dayparts
–Use on cable based on available
inventory
Step: 3 (cont.)
Commercial Length
Both :120’s and :60’s are strategically
integrated into a campaign
– :60’s
–100%-150% higher cost vs. 120’s
–Strategically schedule on selective
dayparts
»Where :120’s traditionally are
difficult to clear
»Demographically targeted
–Base support for cable
»:120 inventory is extremely limited
Step: 4
• Daypart Rotation
– Responsiveness
– Cost
– Targetability of programming
– Availabilities
• During the buy management process, daypart rotations
are adjusted:
– Poor performing dayparts limited or cancelled
– Increase spending in effective dayparts
– Negotiate rates on marginal dayparts (keeping in
Step: 4 (cont.)
• It is important when beginning a new
campaign to schedule a broad daypart
rotation. This will maximize up-front
learning and help extend the life of the
campaign.
Testing
An Added Value/Dimension
• Testing is becoming more important for Direct
Response Advertisers.
– Viability as a DRTV campaign
– Creative
• Unit length
• Copy variable
– Offer variations
– Premiums
Testing
There are two primary forms of testing in
DRTV:
–Fixed-Spot Test
–Matched Markets Test
Each has its uses and list of specific
characteristics.
Testing
Fixed Spot Test (FST)
• Fast
• Controllable
• Guaranteed
• Costly-does not pay for itself
• Campaign performance questions
• “Little U.S.”
Testing
Matched-Markets Test (MMT)
• Slower
• Feasibility test
• Campaign projection
• “Manageable”
• Pays in volume generation
• Pre-emptible
• Replicated DR campaign
• “As it Falls”
Managing the Buy
Objectives are managed over the length of
the campaign
• Counts are received from the
telemarketing services on a daily basis.
• Exact times are received from the
stations.
• Buyers adjust schedules daily based upon
performance and availability of air time.
Managing the Buy
Responsiveness on a daily basis
• Rates are renegotiated.
• “No-charges” are negotiated.
• Ineffective/inefficient dayparts are
eliminated.
• Spending is increased on well-performing
stations.
• Poor stations are eliminated.
• New stations are recommended.
Managing the Buy
As a result...
• Flight dates are shortened or extended.
• Alternate commercial lengths are tested
and used.
• Creative/product fatigue is assessed.
• Individual station activity is added to,
reduced, or cancelled.
Future Opportunities--Long Form
(Infomercials)
As a result of FCC deregulation, Long
Form has grown in acceptance:
–30 minute infomercial
–Marketer is the program producer
–Integrated editorial/commercial
message with response device
Future Opportunities--Long Form
(Infomercials)
Current uses:
–DR marketers
–Lead generation
–Self-help and Self-improvement
Future Opportunities--Long Form
(Infomercials)
Benefits:
–Self-selecting audience
–In-depth product presentation/valued
information
–Immediate response
–Efficient rates
Long Form can be tested in a controlled
environment to determine feasibility.
Radio
• Targeted
• Traditionally not responsive
–Out of home medium
• Need memorable 800#
• Successful as support medium
–Other advertising channels
–Retail
Support Advertising
• What is Support Advertising?
– Selling Ad
– Support Ad
• Types:
– Print/Print
• Teasers
– TV/Print
– TV/Direct Mail
– Radio/Direct Mail
– TV/FSI’s
– Print Direct Mail
Support Advertising
• Why Use Support?
–Increase effectiveness of a single
exposure.
–Avoid horizontal fatigue
–Traditional medium response falling
off.
–Break through clutter.
Support Advertising
• Creative considerations
–Peak Audience Interest
–Sell Ad, Not Product
–Show Premium
–Show BRC, Transfer Device
–Play the Game
Support Advertising
Budget Considerations
Support$
Primary$
% Lift
Example:
% Lift = 25%
Total Budget = $125,000
Support $ = $31,250
Thank you!